Sino Forest - very interesting releases, following, background, position, funding

shootingstar

Is anyone following what's going on with Sino Forest. I didn't read the news for a couple of days given the exam and now just got right back into it.

Read up on the background of Sino Forest if you don't know the background, but in summary, an independent analyst releases a sell report; the stock going into free fall.
The accusations is that Sino cooked their books and no way they couldve went that long without funding equities. what's more interesting is that the author has a short position in it.

Sino Forest is listed in Canada but it's operations are in China and all of it's executives are based in Asia (including CEO). Shouldn't the listing in North America (ADR, crossing listing etc) be better monitoring as the listing requirement are tougher?

A Hedge fund run by John Paulson owns a lot of shares in it and also CPPIB (very big pension plan), shouldn't these big players have good monitoring system of the company?

The report states that it's a large ponzi scheme and they funded more equities instead of debt through out the 16 years., is that a good thing they are funded more equities instead of debt?

This is the most interesting thing that has happened in recent days and it's still under folding.